Everyone connected with Israeli television agrees on one thing: 2013 will be a watershed year that promises to change the face of the industry.
In the wake of legislation at the end of 2012 that rescued Channel 10 from the threat of extinction and gave Channel 2 franchisees Keshet and Reshet some breathing room, the three are now trying to boost their audience ratings as much as they can before the switch to permanent licensing.
Whether they are striving to reach a merger from a position of strength or by becoming established as a strong independent channel, Keshet, Reshet and Channel 10 aren't pulling any punches, even if it means their controlling shareholders must continue injecting cash into them - and plenty of it.
With this pricey battle underway, it's no wonder the first half of 2013 chalked up new records for ratings and audience share in the broadcast market at the expense of other media. The average prime-time rating for Channel 2 during the first six months of the year out of the total population reached a seasonal record 22.2%, compared with 21.7% the same time in 2012.
Meanwhile the percentage of the overall viewing public tuned into commercial television - channels 2 and 10 - during prime time reached an all-time high of 43.8%, meaning prime time commercial television has been making inroads into the market share of cable and satellite channels. The average daily viewing time devoted to the commercial stations meanwhile hit a record 122 minutes, one minute more than the previous year.
This surge in popularity follows massive spending by the franchisees in programming that is particularly expensive to produce programs like "Big Brother" and "The Voice," each of which cost an estimated NIS 1 million per episode.
The franchise battle
Keshet has again taken the lead with an average 24.1% prime time audience, compared with 20.9% for Reshet, including weekends. In February and March with Reshet featuring "The Voice" and "Undercover Boss," the figures for the two Channel 2 franchisees were nearly identical. This was also due to the fact that holidays during the period fell mostly on Keshet's assigned days of Sunday through Tuesday.
In May, Keshet reopened its lead while launching a new season of "Big Brother," its first during the summer months. Although the summer season isn't noted for large viewing audiences, the program has displayed a strong 33.2% average rating.
Keshet's overall ratings, however, are still lower than they were in the first half of the year while Reshet has registered a sharp improvement with its stronger than ever 20.9% average rating, a significant boost from 18.3% in the first half of 2012. Reshet is also the only franchisee to improve its rating since the second half of 2012 which stood at 16.1%, thanks largely to "The Race to the Million" and the local sitcom "Bilti Hafich" ("Irreversible" ) launched in January.
Reshet also faces tougher competition from Channel 10 between Wednesday and Saturday, the days on which it broadcasts and when Channel 10 prefers airing popular shows like "Kolbotek," "The Bachelor," "Extreme Makeover" and the political satire "Buba Shel Medina" ("Sweetheart of a Country" ).
Channel 10's viewing audience, however, sunk to a low of 6.2% in the first half of the year, it's lowest half-year average since 2010 for prime time. New management is now investing in new programming for the long term in hopes that within a year or two the station will gain a larger presence in the market.
The public broadcaster Channel 1, meanwhile, fell to a low of 3.2% in ratings compared with 3.4% in the first half of last year, and less than half its average 7.1% rating in the first half of 2007.
Just as in 2012, the first half of 2013 was dominated by reality shows, which accounted for half the top 10 programs. "Master Chef" took first place with a 37.6% average rating but was only broadcast in January when TV audiences tend to be larger. The finale was the most watched broadcast in the past 13 years, with a 43% rating.
Second place went to Keshet's "Big Brother," followed by Reshet's "Undercover Boss" with an average rating of 30.1%. Keshet took fourth spot with perennial current affairs spoof "Eretz Nehederet" ("Wonderful Country" ), achieving a 29.6% rating.
The fifth and sixth most popular shows were both musical competitions: Keshet's "Beit Sefer La'Musika" ("Music School" ) at 29.4%, followed by Reshet's "The Voice" at 28.3%. Towards the end of the year the rivalry between singing competitions should heat up even more with Keshet broadcasting a new season of "Kokhav Nolad" ("A Star is Born" ) while Reshet airs the Israeli "X Factor."
The top 10 shows also include "Bilti Hafich," as well as the long-running investigative reporting show "Uvda" ("Fact" ) which closes the list with an average rating of 23.5%.
All in all Keshet placed six programs in the top 10 while Reshet accounted for the remaining four. Channel 10 failed to reach any higher than 22nd place with Amnon Levy's interview show "Panim Amitiot" ("The True Face" ) attaining an average 12.7% rating when it was broadcast during the winter. "Kolbotek," the enduring consumer affairs and investigative reporting show now approaching its fifth decade on the air and hosted by Channel 10 CEO Rafi Ginat, has managed to come up with a 12% rating at this point.
At 42%, television takes the thickest slice of the overall advertising pie, for NIS 1.4 billion in 2012. There has been a 7% increase in the total of prime-time minutes devoted to advertising on the commercial channels. Reshet leads with an average of 33:36 minutes of prime-time ads, followed by Keshet with 32:35 minutes and Channel 10 with 27:24.
Ad rates are set according to the average rating at the time the ad is running. The two franchisees of Channel 2 registered an aggregate half-point ratings increase while Channel 10 dropped a point and a half. This meant that revenues for Keshet and Reshet rose by 7%, according to industry estimates while those for Channel 10 held steady. But all the franchisees are believed to be losing money in 2013 because they are spending so heavily on content brought on by stiff competition as well as regulatory factors.
Franchisees are permitted to advertise roughly 40 minutes in prime time, which means they still haven't succeeded in selling all the airtime at their disposal. Also, the number of advertising minutes is still 3% lower than it was in the first half of 2011, just before the outbreak of the cost-of-living protests.